Renewal Offer

[somarco]

Got a renewal offer in today's mail. Small group I have had for almost 2 years. Not a lot of money in this case but not a lot of work either, in spite of the fact the guy was a pain in the butt iniitally.

The October renewal is 34%.

That's a big jump and he will scream . . . but not too loudly I suspect.

28% of the increase is due to demographics, inflation, etc.

The other 6% is for utilization and expected future claims.

For the last 21 months they have paid $25,114 in premiums.

The carrier paid out $83,546 in claims including $22,818 in Rx claims.

(For those who think it is OK to sell plans with limited Rx benefits, you might want to read that line again).

$22,818 in Rx claims.

This is what insurance is all about, and this is what drives me more than any commission check.

 

[Invain15]

sweet. its always good when we can hear some good news about what insurance companies are doing

 

[ABC]

That is awesome that your able to obtain claims data on a small group. That makes the renewal process a lot of easier when you have that info.

Your group has over 300% loss ratio not much you can do with them.

In your state is there a state law that your able to obtain claims on groups under 50? In the state of Indiana were only able to get claims data on groups over 50.

 

[somarco]

About half my group carriers provide loss data. Normally I don't get it from this carrier but I suppose they wanted to "justify" the renewal action.

FWIW I checked their rates against 5 other carriers offering similar plans. All the rates, after adjusting for the max risk load, are 10 - 20% higher than renewal.

Looks like they, and the carrier, are going to have to suck it up for another year.

AFAIK there is not state mandate that carriers reveal loss data on small groups. Even if available it is meaningless as a group of this size (2 lives) isn't credible any way.

Any rate increase over 15% is reviewed and shopped.

 

[Crabcake Johnny]

It's important for new agents to pay attention to the fact that 25% of those claims were RX.

 

[Delta76]

I delivered a renewal last year with an 800% loss ratio and they complained about a 12% rate increase (all trend, they were already at the top table). However, they quickly figured out there wasn't anything better out there.

 

[somarco]

800% loss ratio and they complained about a 12% rate increase

Amazing the "hand out" mentality of buyers.

 

[speckled horn]

If you can't sell that renewal, you better quit!

Sounds like a UHC renewal. Issue trend renewals on terrible groups & hammer the good ones with 50-85% loss ratios.

Tell the ER to sign the offer before the carrier catches their mistake.

Good luck!

 

[jarrodn82]

Really...good to see some good luck coming someones way

 

[alphawave2k]

FWIW I checked their rates against 5 other carriers offering similar plans.
AFAIK there is not state mandate that carriers reveal loss data on small groups

Can you please decode "FWIW" and "AFAIK"?
I just love the acronyms that exist in this field. Thanks


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